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GF CITY COUNCIL: No break for hospital

A proposed tax break for the new hospital at Grand Forks' Aurora Medical Park failed to win a majority of the vote from the City Council on Monday night.

A proposed tax break for the new hospital at Grand Forks' Aurora Medical Park failed to win a majority of the vote from the City Council on Monday night.

The atmosphere in council chambers was electric as the council cast a highly unusual 3-3 vote before a crowd of more than 125, an unusually large audience for the council.

One council member, Doug Christensen, an attorney, recused himself because of past work with some of the Aurora project principals. Mayor Mike Brown, an Altru physician, could not break the tie because he also perceived a potential conflict of interest.

City law says motions must have a majority to pass.

Each side in the debate had powerful constituencies behind them.

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Aurora's argument that its new hospital would give the region more choices in health care resonated with many Grand Forks voters. Hundreds e-mailed their council members. Lisa Warner, who works for the Aurora group, presented the council with a petition that she claimed represented 3 percent of the city's population. She would not state the number of signatures she had.

Altru Health System, which opposes city incentives for a rival hospital that it says would take its patients, is the city's third-biggest employer, with more than 2,500 full-time positions. Earlier, Altru employee Jessica Logan gave the council a petition with 624 signatures.

Ultimately, though, council members voting against the tax break said they simply didn't believe Aurora's new hospital could meet the city's economic development criteria. In other words, they believed new jobs created at Aurora would only be taking from existing jobs at Altru.

Voting "no" were council president Hal Gershman and council members Curt Kreun and Eliot Glassheim.

No deal

There had been a strong attempt at compromise to get around the controversial issue.

Council member Bob Brooks' motion for a two-year property tax exemption worth about $793,000 was considerably smaller than what Aurora originally had requested.

The group first suggested a $2.6 million, five-year deal but, sensing council disapproval, changed its request to a $1.6 million, five-year deal. Aurora representatives said they would invest $21.6 million in the new hospital and employ up to 500 people.

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At the last minute, council member Mike McNamara even suggested the council attach conditions to the exemption but found no supporters, not even Brooks.

Brooks said he doesn't want to tie the hands of businesses.

New wealth?

For the "no" side, the key question was, would a new hospital be able to bring new money into the area's economy? That means, it has to get more than half its patients from outside a 50-mile radius.

Aurora representatives have said they could do that but have provided few details other than saying that most of their would-be patients are people who already are leaving the city for health care.

Kreun said it's hard to imagine Aurora getting so many patients from more than 50 miles away when none of the hospitals out in the region have more than 60 percent occupancy. The state of Minnesota, he said, still has a moratorium on new hospitals because of the fear of excess capacity. That's why Kreun is convinced, he said, that a new hospital in Grand Forks would only spread the same number of patients around.

Choice debate

For the "yes" side, the key question was, should the council subsidize a new hospital so residents have more choices? Well, it was the key question for the only council member to change his stance.

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Council members Art Bakken and Brooks had decided long ago they would vote "yes," but McNamara has been on the fence for a while.

On Monday, when he explained his vote, McNamara said a big factor for him was the overwhelming number of voters who told him they wanted more choice.

Gershman explicitly said that was not a factor for him in his "no" vote. Most Americans, if asked, naturally would say more choice is better than less, he said. But the fact is, he said, there are many independent clinics in the Grand Forks area and, ultimately, it is the doctors in those clinics who choose to refer patients to Altru.

Tran reports on City Hall. Reach him at (701) 780-1248 or ttran@gfherald.com , or see his blog at www.areavoices.com/gfhcitybeat .

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